Warren's college loan forgiveness plan opens debate

by Katherine Fernandez - Copy Editor

Tue, Apr 30th 2019 10:25 pm

progressive proposal Elizabeth Warren's new proposed loan forgiveness plan will rid college students of the expensive debt that will follow them for years to come. But her new idea will come with backlash from Republicans as it will force wealthy families to pay more than they already have to in taxes.

With college commencement fast approaching, graduating students have one big, dark cloud looming over their heads: student loan payments. Massachusetts Senator and democratic presidential candidate Elizabeth Warren has proposed a generous student loan cancellation plan that would eliminate the student debt of up to 42 million Americans.

Warren announced her “transformational” higher education reform plans on the official page for her presidential campaign on Medium. According to the blog post, the proposal would cancel up to $50,000 of college loans for every person in a household whose income is less than $100,000.

“The $50,000 cancellation amount phases out by $1 for every $3 in income above $100,000, so, for example, a person with household income of $130,000 gets $40,000 in cancellation, while a person with household income of $160,000 gets $30,000 in cancellation,” Warren wrote. Households who generate income above $250,000 are not eligible for this plan. In addition to working toward eliminating the student debt crisis, Warren seeks to invest $100 billion in Pell Grants over the span of a decade to help students pay for non-tuition costs like rent and meals in an effort to increase retention and graduation rates.

Many students work long hours at full time jobs to support themselves while they attend college and the stress often leads to them falling behind in their studies. Warren cites data from the National Student Clearinghouse Research Center that says “two-thirds of students complete a four-year public college degree in six years and only about a third of students complete a two-year public college degree in six years.”

By increasing funding that would help students cover costs of living while they go to school, Warren hopes to see graduation rates skyrocket. Her plan also includes making tuition free of cost at all public two-year and four-year institutions.

Warren’s vision for college students goes beyond easing the financial burden. She also wants to make changes to the admissions process by making it so that public universities cannot base admission decisions on an applicant’s citizenship status or prior criminal offenses.

With all of these grand promises, many are wondering how Warren will finance this overhauling of higher education.

She seeks to initiate a “Ultra-Millionaire Tax” that would tax the 75,000 U.S. families with assets totaling $50 million two percent of their earnings every year, while those with assets over $1 billion will be tfd with three percent annually.

This tax plan would generate more than $2.8 trillion in 10 years, which is sufficient enough to cover the projected $1.25 trillion Universal Free College program and $640 billion debt cancellation plan.

Although a recent poll conducted by Business Insider reported that 60 percent of voters support the proposed wealth tax, it seems illogical to believe that Sen. Warren’s plans will come to fruition.

Wealthy families won’t be keen on the idea of parting with their money and since wealth in America often has a direct correlation to political and social power, it is not likely that her tax proposition will ever be anything more than what it is now.

Warren is also being accused by many of pandering to black and Latinx voters by emphasizing how those marginalized groups would specifically benefit from her debt cancellation and free tuition plans.

Some people surmise that her proposed $50 billion fund for Historically Black Colleges and Universities (HBCUs) and Minority-Serving Institutions (MSIs), which she also mentions in her blog post, is little more than a ploy to swing votes in her favor.

With her controversial platform and an abundance of competition leading up to the 2020 presidential elections, Sen. Warren has made a name for herself in the world of politics and we will have to wait and see what other systematic changes she aims to make if she wins her bid for the presidency.